"Alot of what an automobile is today came out of innovations invented and commercialized by General Motors," observes Robert Purcell, executive director, General Motors Advanced Technology Vehicles. And he goes on to list a number of things, from electric headlights to starter motors. This is one aspect of what he calls "intellectual leadership," the development of new technologies that have an effect on the market. Another aspect is what Alfred Sloan (who became president of GM in 1923, CEO in `37, and who retired in `56), created with the concept of "A car for every purse and purpose," which stands in stark contrast to Henry Ford's "Any color you want as long as it's black"—or, rather, Ford's notion is stark and Sloan's colorful. GM, through fulfilling Sloan's idea, Purcell argues, provided the vision of what the auto industry has become, an industry based on a diversity of offerings: from the Cavalier to the Sedan deVille, from the Escort to the Town Car, from the Neon to the Concorde..."If the auto industry had developed along Henry Ford's model, his vision," Purcell says, "automobiles would be a commodity product, one that would sell on one dimension: price."
This discussion about intellectual leadership is predicated on the effort to get an understanding of why GM went to market in late 1996 with the EV1, a purpose-built—meaning not an adaptation of an existing platform—electric vehicle. And how Purcell, a man who was an apprentice mechanic at age 15 and who spent much of his teen years and early 20s working on cars in independent garages and dealerships, ended up heading up an organization that may transform the auto industry in a way analogous to the effect that Sloan's notion of what a car—or cars—should be has.
There is an interesting intersection of the interests shared by the individual and the corporation in this case.
Purcell went back to school at age 28. He obtained a master's degree. He spent his time dealing with cars outside the arena of the OEMs. He wanted to learn about what went on there. So business degree in hand, 15 years ago, he started at Pontiac in forward program analysis ("We tried to figure out how to make the right investments to get to our cost targets for the programs.") Then it was to the business planning director position for GM Powertrain, planning director for GM North American Operations, and then a corporate strategic planning role.
Jack Smith was elected CEO and president of GM in 1992. His mission was to get the corporation back on track. "The corporation wanted to reassert itself as an industry leader," Purcell recalls. It may have been an intellectual leader that catalyzed marketing and developed the catalytic converter, but in the early `90s, speculation about the very survival of the corporation was seriously discussed by people in the know. Industry leadership and how to work toward getting it back was what Purcell and his colleagues set about to figure out.
One aspect of what was required consists of intellectual leadership, technology and vision. The second attribute of an industry leader is capability leadership, which is defined as owning the core competency that serves as the basis for competition within the industry. "For the past 25 years," Purcell explains, "Toyota was the capability leader with its lean production system." All other car companies have been working hard to develop their own "(fill in the blank) Production System" so they can compete with Toyota's competency.
Finally, there's the element of results, of sustained performance. It is one thing to have notable product technologies and robust system capabilities. Making a business case for them is something else. And GM had learned the hard way about making investments in technologies and systems that nearly brought the giant to its knees.
"One of the problems with doing strategy work," Purcell muses with a smile, "is that sometimes they ask you to go do it."
In February, 1994, Purcell made his last presentation to the GM Board of Directors about the vision and strategy for the company. GM had been working on an electric vehicle (EV) program. Due to the then-tightening financial straits, the program was taken off of production status in late 1992. By the time Purcell had that meeting with the board, the corporation had invested nearly $300-million in the EV program—a program that seemed unlikely to be much more than an exhibit at Epcot Center at Walt Disney World. The Impact, as the vehicle was named, would have little impact on the future of the corporation—or so it seemed.
Purcell says that as they investigated the aspects of industry leadership, it became clear that the EV program had some real possibilities for doing some of the things for GM that GM had historically done for the auto industry: Cause fundamental change. Done right, the EV could make GM a leader in automotive technology in the marketplace, the place where it really matters.
The decision was made to reactivate the EV program, to bring it back to production status. And, critically, as Purcell puts it, "Be the first to market with a fundamental technological breakthrough for the automobile."
This is not to say that Purcell or anyone else at GM thinks they invented the contemporary electric car. But just as the automobile itself wasn't invented by Henry Ford, Ford is given a tremendous amount of deserved credit for making the automobile something that was accessible to a wide number of people. Setting up a factory to produce quantities of marketable EVs is what the vision was—and is—all about.
Purcell was asked to be the program manager. He accepted. And as far as he is concerned, it is a position that he wants to continue to fill for some time to come.
Who wouldn't? He's heading up a team of fewer than 400 people—small by OEM standards. That team is charged with the design, development, validation, and production of vehicles that are notably different than those that have dominated the streets of the world for this century.
Time is an important factor to take into account when thinking about what GM is doing with its Advanced Technology Vehicle program and related initiatives. During a press briefing at the 1997 North American International Auto Show in Detroit, Jack Smith stated that no car company could expect to thrive in the 21st century with a total dependency on internal combustion (IC) engines. The result of this has lead to various propulsion alternatives that the corporation is working on, including a direct injection diesel, a turbine auxiliary power unit, a power assist hybrid propulsion system, and a flywheel alternator starter input differential. Jack Smith concluded his comments at the briefing by saying, "The world is changing at a very rapid pace. Success in the future will come to those companies who put themselves in a position to control the pace of change, by being the leader."
One of the phrases that Purcell frequently uses in relation to the EV program is: "This is not about the next 10 days. This is about the next 10 years." The 10 days he refers to is, of course, the traditional auto industry sales reporting period. The EV1 is, in part, about building a platform for the future, about helping the corporation get "in a position to control the pace of change, by being the leader."
But it isn't just about what's going to happen. Smith also stated at the briefing, "Advanced technology must be approached on a sound business basis to be truly viable." In other words, the green light wasn't given to Purcell's group so that they could go out and shoot at the stars; the notion of return-on-investment isn't filed away in a drawer somewhere.
There are some immediate and near-term organizational and technical consequences—benefits—of the activities at Advanced Technology Vehicles. Purcell says that the portfolio of Advanced Technology Vehicles is about innovations in product, processes, and business practices: "We are testing out the new ideas that could become the mainstream way that GM conducts business." This ranges from using magnesium for steering wheels to developing the means and methods for efficient low-volume production. Weight savings and improved manufacturing capabilities are things that GM needs now—and that holds true for virtually all auto manufacturers.
To be sure, there probably isn't a single car company in the world that isn't involved in an alternative power program. Several industry observers have taken a look at the low numbers of EV1s moving off the lots in San Diego, Los Angeles, Phoenix, and Tucson and see the car as Smith's Folly—as in Jack and/or former chairman Roger Smith. But to look at those "10-day numbers" alone is to overlook some nontrivial things.
"Will the EV1 in its present form ever replace an IC fleet in any significant numbers?" Purcell asks, then answers, "No."
Given that it cost on the order of $500-million to get the EV1 on the road, that seems like a curious Q&A.
But Purcell continues the Socratic monologue, "Will the systems and the processes that are in the EV1 become high-volume opportunities for GM? Absolutely."
The EV1 is, Purcell claims, "the world's most energy efficient vehicle program. Every system is optimized for energy consumption." So, Purcell explains, various elements of the EV1, from the forged aluminum suspension components to the lightweight seats, are likely to find wide application in vehicles built for non-North American markets, where the vehicles are smaller and energy efficiency is of greater concern. Those markets are also the ones where the greatest growth for the auto industry is likely to happen.
"That's how we're going to get the ROI," he maintains.
Still the question remains: Why build the car, why not just work as other companies are, with limited fleets and development work? Purcell answers, "It's the discipline of production—there is no good way to simulate that in a development environment." There are too many factors, too many unknowns. Can the components actually be produced under production conditions? Can a supply base be secured? How well can you build to meet market demands? They wanted real answers to these very real issues that are likely to be faced by full-bore alternative-fuel vehicle manufacturing.
Purcell says there are two things that have to be taken into account. One is technical feasibility: Can you make it work? The other is commercial viability: Can you make it work at a cost that people can afford it? The discipline of production helps provide information and understanding toward answering those questions.
In the long term, perhaps 50 years from now, Purcell says, fuel cells will probably stand as the replacement for IC engines. Does this then mean that using lead-acid batteries or the nickel hydride batteries that will become available for the EV1 represents moving down a blind alley? Purcell says that's not the case. Fuel cells create electricity. Control systems and drives are still needed. The hardware and software being developed by the Advanced Technology Vehicles team are fully applicable. In fact, Purcell maintains that the algorithms being written by the cadre of software engineers that are working at the vehicle center are what really represent the competitive advantage for alternative fuel vehicles.
Purcell is confident that there will be a change in the automobile industry, a change that will fundamentally shift the way what vehicles are and how they are manufactured. "The car guy of the future will be as involved with software as the car guy of today is involved in hardware," he says.
How does he hope the EV1 will be seen by the people of the future? "As the vehicle that started it all." AD&P
The Future of Automotive Assembly?
Asked to take a look ahead at what vehicle assembly plants and related methods will be like in 20 years' time, when the EVs and hybrids and whatever are, if not the status quo, then at least a large part of it—which means there will be a major effect on what's put together in a plant— J. Robert Thompson, director, Manufacturing, GM Advanced Technology Vehicles, provides the following observations:
Building the S-10 Electric
The EV1 is a purpose-built vehicle. This means that it was initially conceived as being an electric car. The second electric vehicle that GM has introduced to the market—the first was delivered to a customer in May 1997—is a Chevrolet S-10 pickup.
You would be hard-pressed to distinguish between a conventional S-10 and an electric version. The latter has some different decals. There is some aerodynamic modifications, such as a front air dam and a half-tonneau cover at the box of the cargo box. This brings the coefficient of drag down to 0.34; a conventional S-10 has a Cd of 0.44. But despite the fact that there is a 1,300-lb. battery pack, consisting of 26 batteries, sitting between the frame rails, the electric S-10 looks just like a conventional S-10 from the outside.
If you crawl below the electric vehicle and really know your frames, you'll discover that there is a purpose-built frame. For one thing, there is the battery pack that needs to be handled, which is not the case with a regular S-10. And the big difference is the S-10 Electric is a front-wheel-drive truck (which may make it unique among all light trucks), so a new rear axle had to be developed.
This close affinity between the regular and the electric—there are just 250 parts unique to the S-10 Electric—is by design. That's because the trucks are assembled—for the most part—at the GM Truck Group assembly facility in Shreveport, Louisiana. As Henry C. Thompson, engineering manager, Manufacturing Engineering, GM Advanced Technology Vehicles, puts it, "To make this a viable business, we worked to keep costs down and to keep the whole operation very lean."
The transformation into an electric vehicle occurs in what had been a vacant warehouse that's located one mile by crow fly and three miles by road from the main Shreveport plant. Thompson and his colleagues started refurbishment of the 100,000-ft2 building in January, 1996, and were running pilot vehicles by September of that year. The area used for the manufacturing operations measures 68,000 ft2.
The routine is that painted cabs, boxes and front-end sheet metal are taken from the lines in the main plant and delivered to the satellite plant by truck in lot sizes of five. Then the truck is processed through 11 workcells. There are 13 people who work in the cells, and 22 in total at the electric vehicle facility. All were volunteers who came over from the main plant.
The major difference between the operations in the two plants is the amount of work that is done by the individuals involved. Those in the S-10 Electric plant may perform as many as 150 tasks in a work cell. The cycle is 53 minutes long, not 53 seconds, as is close to the rate in the mass production facility. The output of the satellite plant is approximately 10 units per day (one-shift operation).
In the satellite plant Bill Szkodzinski, manager-Manufacturing Engineering, GM Advanced Technology Vehicles, points out, "There are no monuments." There are no pits. No solid foundations at the work cells. There is just a single robot, a Fanuc S420i, that's used for glass installation. "It's the only thing in the plant that looks like it could go 60 jobs per hour," Szkodzinski notes. The assemblies are moved around on wheeled carts or by lift trucks. Once the wheels are on, the vehicle is pushed from station to station. Once the truck is completed, it is shipped back to the main plant and put on the line with the conventional S-10s. There, wheel alignment and dynamic vehicle testing are performed. Not only does this mean that the S-10 Electrics get the same type of OEM testing that regular vehicles get, but it also means that they were able to save in excess of $500,000 at the satellite plant by taking advantage of the existing equipment in the main plant.
Silicon Car Guys
The staffing at the GM Advanced Technology Vehicle center in Troy, Michigan, is atypical for most automotive organizations. The emphasis is not just on research, nor just on development, nor just on production. It partakes of all of these things. And whereas conventional auto organizations are of a size that means that these functions are physically separated, at the center, which is staffed by fewer than 400 people (the numbers are growing, but there is a conscious awareness of maintaining a manageable size: as Bob Purcell puts it: "As an organization, we will never grow to scale"—day-to-day production of self-sustaining technologies will be spun out, or transferred, to other groups within GM), there is a mixing of staff on the premises.
What's more, there is a mission that they are aligned to. That is, all automotive companies have special development organizations. But the tendency in them is one where the developments produced are either bookshelved or something that must undergo long-term observation. At Advanced Technology Vehicles, the objective is not just to come up with new and different ways to design, develop, produce, equip, power, propel. . .vehicles, but to create new and different things that can be applied or marketed in fairly short order. There is a real connection to the market—even though the market is one that is still under development.
During the development of the original Macintosh computer, Steve Jobs reportedly exhorted the engineers and technicians working on the project with the phrase, "Real artists ship." Developing and shipping real product is essential. Not surprisingly, Advanced Technology Vehicles has attracted many people to its ranks who would probably have otherwise been working in Silicon Valley—or someplace other than the auto industry. Although this undoubtedly has something to do with the fact that the algorithms that provide control for the drives and the motors are, in Bob Purcell's view, the competitive advantage that is being created, it probably has at least a little something to do with the Apple-like notion of "Putting a dent in the universe."
Although an electric car is just a car, it is still sufficiently—or potentially—infrastructure-shifting, which is an appealing possibility for some good engineers who might have figured that the auto industry was the last place they'd want to work. If nothing else, the attraction of these people to the auto industry may be one of the more significant legacies of the original EV1 program.
Echoes of "Get a Horse"
The number of EV1s that have been acquired by consumers is, by the measure of volume that is standard in the mainstream auto industry, small. In the first five months that the vehicle was available in a limited market area (four metro regions in Arizona and California), fewer than 200 were leased.
(The vehicles can't be bought. There is a three-year lease available. The reasons: the life span of the lead-acid batteries that presently power the EV1s [nickel-hydride will become an option] is approximately three years. And given the fact that GM is dedicated to making sure that the consumer experience with the EV1 is as satisfying as possible—which is sometimes reported as though that is a heinous thing—the corporation wants to make sure that only good vehicles are out there.)
If, the argument about why the EV1 is a failure goes, the EV1 was the greatest thing since sliced bread and canned beer, consumers would be snapping them up faster than the Lansing Craft Centre can turn them out. And the people at the Lansing Craft Centre aren't working at a whirlwind pace.
But how many whole loaves and bottles do you think were sold in the first few years of off-the-shelf sliced and steel-jacketed Bud?
Or, if that analogy is too far a stretch, consider this: The automobile was introduced by Gottlieb Daimler in 1884. In 1903, Henry Ford introduced the Model A. Ford sold 1,708 units that year. If we use the `97 model year EV1 numbers and assume that, perhaps, 500 vehicles in total are leased, then that number is respectable by the metric of how few internal combustion engine vehicles were moved in the early years of the industry. AD&P